News

NBC Universal responds to Apple pulling fall lineup

By Charles Starrett ● Saturday, September 1, 2007

NBC Universal has issued a statement responding to Apple’s announcement that it will not be offering the network’s fall lineup of programming, due to NBC’s non-renewal of its iTunes contract. In its statement, Apple claimed that contract talks broke down between the two companies due to NBC’s demand to raise wholesale pricing of shows in a manner that would more than double the current price of $1.99 per episode. Cory Shields, executive vice president of communications for NBC Universal, disputed these claims in a prepared statement.

“We never asked to double the wholesale price for our TV shows,” said Shields. “In fact, our negotiations were centered on our request for flexibility in wholesale pricing, including the ability to package shows together in ways that could make our content even more attractive for consumers.” He added, “It is clear that Apple’s retail pricing strategy for its iTunes service is designed to drive sales of Apple devices, at the expense of those who create the content that make these devices worth buying.” Shields went on to say that NBC also asked Apple to take “concrete steps” to prevent piracy, “since it is estimated that the typical iPod contains a significant amount of illegally downloaded material.” Apple has yet to respond to the statement.

Comments

1

What does having illegal content on the iPod itself, have to do with sales in the iTunes Store. The files they sell have DRM.

Posted by zerock on September 1, 2007 at 12:53 PM (CDT)

1

Haha, I’d very much like to see these show packages NBC had in mind. Just the fact that they wanted flexible pricing should be a giant red flag. And as for that “illegally downloaded material” NBC estimates is on everyone’s iPod, congratulations NBC, you’ve just ensured that’s ALL that’ll be on anyone’s iPod when it comes to your TV shows.

Posted by Geof on September 1, 2007 at 12:55 PM (CDT)

1

Pure FUD if you ask me.

“flexible pricing” WAS a big red flag… and why should NBC be tinkering with Apple’s marketing of the shows? It seems like they make sense as they are now.

Also, playing the “iPods have illegal content” card is a wonderful way to shift the focus. There is no way to prevent illegal content from showing up on portable players. Until the day that all music/movies are DRMed like crazy… from the studio to the speakers/TVs, it’s never going to happen.

Posted by mitchell_pgh on September 1, 2007 at 1:17 PM (CDT)

1

Stand back everyone. Time for the blame dispersal units to jump into action.

Posted by Don Trammell on September 1, 2007 at 1:31 PM (CDT)

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I don’t see them asking any other company to lock dock their player… These dinosaur companies are shaking today, they just don’t get the digital revolution.

Posted by Chris G on September 1, 2007 at 1:37 PM (CDT)

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Where do these guys dig up this crap about most iPods having mostly pirated material on them? That’s the most ludicrous thing I’ve ever heard.

Posted by Eric Shepherd on September 1, 2007 at 1:41 PM (CDT)

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I love Apple, however, I believe that they are wrong this time. NBC owns the content and they can chose to martket it however they wish. Is it so much to ask for flexibility? To ask to bundle some material? And to ask for stronger anti-piracy?

Posted by Larry R on September 1, 2007 at 2:25 PM (CDT)

1

Shields went on to say that NBC also asked Apple to take “concrete steps” to prevent piracy, “since it is estimated that the typical iPod contains a significant amount of illegally downloaded material.”

Just checked all my ‘typical iPods’ and none of them have any “illegally downloaded material” on them….

Guess they aren’t typical….

Posted by Bob Levens on September 1, 2007 at 2:35 PM (CDT)

1

I agree with Larry R., NBC has the right to market their content however they choose. As a consumer, I have the right to tell NBC to take their content and stuff it up their nose—- which is precisely what I’ll do.

I won’t pirate their content, but neither will I purchase it at inflated prices (or with ridiculous “bundles” of crud I don’t want).

Posted by Dave on September 1, 2007 at 2:42 PM (CDT)

1

I’d be all for making my own bundles for the price of X. But not for NBC to make their own bundles for the price of X*2—which, of course, would be loaded with crap I don’t want.

Posted by schiano on September 1, 2007 at 2:48 PM (CDT)

1

I love Apple, however, I believe that they are wrong this time. NBC owns the content and they can chose to martket it however they wish.

Of course they have this right, just as Apple has the right to dump them when they try to do something ridiculously stupid. Apple has a business model that works, they don’t want to jeopardize that by pandering to companies so scared of “piracy” that they’re willing to destroy themselves in the process of trying to prevent it.

Posted by ArtDecoDalek on September 1, 2007 at 3:02 PM (CDT)

1

NBC sounds like they are asking Apple to do something about customers pirating content. First of all, that’s a vast generalization of people with iPods. Second of all, what on earth could Apple do to prevent piracy with the iPod? It’s like asking Sony to put tougher measures in their Walkman so that pirated tapes can’t be played in them. It’s their fight not Apple’s.

It just seems to me that the content producers have a generally hostile view towards their customers still.

Posted by Jeremy on September 1, 2007 at 3:53 PM (CDT)

1

You forget their definition of piracy and everyone else’s definition are two different things. According to the RIAA songs ripped from CD’s that you own and transfered to your ipod are illegal.

Posted by Anijake on September 1, 2007 at 4:18 PM (CDT)

1

You’ll find out soon enough how little you and your company know about piracy in the digital age.

Another case of the consumer being called a thief.

Meanwhile the thieves weren’t readily available for comment, as they were too busy stealing your programs. Which they can do extremely easy, with or without Apple.

And since you can’t buy it now, just record it and create your own.

How dumb do you think your consumers are?

“Flexibility” is the new word for how far can we bend you over?

And this is the think tank that run companies and/or egos?

Posted by BrendanPatrick on September 1, 2007 at 4:51 PM (CDT)

1

“It’s like asking Sony to put tougher measures in their Walkman so that pirated tapes can’t be played in them.”
Remember when Sony tried to sell their music players supporting only their proprietary ATRAC format? It didn’t take them long to figure out nobody would buy a media player locked to one format and added mp3 support. Apple would have to lock the iPod to protected AAC format to prevent any “illegal” content on their players.

Posted by Sparkee on September 1, 2007 at 5:03 PM (CDT)

1

I own 4 ipods and there is not one
illegally downloaded material on any of them. sounds like ballmner
has been writing there press release.

Posted by macfreak11 on September 1, 2007 at 6:27 PM (CDT)

1

“Flexibility” is the new word for how far can we bend you over?”
Hahahahahaha!

1

A Joke:
What’s the difference between a Twentieth Century Fox Television Programming Director and an NBC/Universal Marketing Director?

They’re both incompetent, but The Fox Executive has better Marketing Savvy.

Posted by Salvo.Dan on September 1, 2007 at 7:52 PM (CDT)

1

Sparkee:
I wasn’t talking about the Sony digital music players; I was talking about the original Walkman that played audio cassettes. To me NBC is asking Apple to make sure that pirated content can’t be played on the iPod. That can only mean that open formats aren’t allowed on there without DRM, which is an insane notion.

I guess I’m just saying that NBC is responsible for that, not Apple. They’re not going to hobble their device because NBC is not offering consumers what they want - which is exactly what’s happening with their little web Hulu thing. Who wants to sit in front of their computer and watch a flash episode of a show… with commercials that can’t be skipped?

Besides that, what’s up with $2 per episode in the first place? Apple should just let them have their pricing and let the market decide at some point - it’s their loss. I wouldn’t pay $2.

In some ways I think piracy is wrong. I pay for the content I have personally, but in some ways, I really think the media companies are truly at fault. They have made a business of selling the same content over and over and over again when DVDs get scratched when CDs get lost, when a new format comes out. Now that customers have the ability to preserve the life of their products and use them flexibly, the content companies are freaking out because they can’t charge for all of that.

Posted by Jeremy on September 1, 2007 at 10:03 PM (CDT)

1

While a handful of people have come forward saying they don’t have “a single pirated thing” on their iPods, let’s face it—many people do.

But that has nothing to DO with this fiasco going on with NBC.

Apple already DRMs their content. What more do they think they could do? Only allow the videos to be played on the PC? Not allowing you to burn backups? Having iTunes call and validate with the central NBC/U server before allowing you to watch the new Office episode?

Or is this really just a backdoor way of trying to extort that “per iPod pirate tax” from Apple like the music arm did with the Zune?